Class A/B RSI Bearish Divergence on SPY Futures?
Really posting here to see if anyone would validate this for me but I was looking on the chart and this idea came about. On the weekly chart for ES1!, there seems to be class A or B Bearish Divergence developing on the Weekly timeframe.
Listen, of course we all know SPY trends upwards over time but is this an indicator of a larger sell the market needs to go higher every once in a blue moon? This is guarenteed a macro trend and I probably will have to wait a year for this analysis to play out but hey, at least we're here.(***ponders on how I charted Gamestop at $10 but never traded because of lack of knowledge***) Anyways, this is something I will of course monitor but let me highlight instances in history this has happened. Please feel free to give your input on this analysis!
Jan 1998 thru Apr 2001 (News Driver: Dot-Com Bubble)
Jan 2013 thru Feb 2016
Current: Jan 24' thru Nov 24'
I will come back to this in the next few months. Happy Trading!
Listen, of course we all know SPY trends upwards over time but is this an indicator of a larger sell the market needs to go higher every once in a blue moon? This is guarenteed a macro trend and I probably will have to wait a year for this analysis to play out but hey, at least we're here.
Jan 1998 thru Apr 2001 (News Driver: Dot-Com Bubble)
- Price makes higher highs from Jan 98' thru Mar 00'
- From Mar 98' thru Mar 00', the 3 peaks formed on the RSI leading to price establishing a lower high (SMT) on Sep 00'. Fails to make new all-time high
- From Sep 00' to Apr 01' price moves down as much as 30% over the next 224d
Jan 2013 thru Feb 2016
- Price makes higher highs from Jan 13' thru May 15'
- From May 13' thru Jun 14', the 3 peaks formed on the RSI leading to price establishing a lower high (SMT) Jul 15' and a following lower high on Nov 15'
- From Jul 15' to Aug 15' (42d) (News Driver: Lagging China Market) price moves down as much as 14% and as much as 14% on the Nov '15 lower high to Jan 16' (78d) (News Driver: Oil Prices)
Current: Jan 24' thru Nov 24'
- Price has been making higher highs all year
- From Mar 24' thru , the RSI has been making lower highs while price is making higher highs
- We are now at a point where price is pushing to go higher but what I would want to see based off of historical data is for price to consolidate or some type of Bearish Turtle Soup forming. If this happens and the RSI returns to Fair Value, we could be in for a sizeable sell of for at least a couple of weeks in the near future.
I will come back to this in the next few months. Happy Trading!
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